Thousands of investors are suing the Royal Bank of Scotland for nearly £4bn alleging it misled shareholders over a 2008 rights issue.
The RBOS Shareholder Action Group contains more than 12,000 shareholders and 100 institutional investors. It is also targeting senior executives including Fred Goodwin, Tom McKillop, Johnny Cameron, and Guy Whittaker.
The action group claims the bank’s directors misled shareholders by misrepresenting the underlying strength of the bank and omitting critical information from the 2008 rights issue prospectus. The Government purchased 82 per cent of the bank just months later to save it from collapse.
It means that RBS could be liable for the losses incurred on shares subscribed in the rights issue, through breaches of Section 90 of the Financial Services and Markets Act 2000.
RBS has 30 days to respond to the claim.
A statement from the investors says: “Today represents a giant step forward for the many thousands of ordinary people who lost money as the result of inexcusable actions taken by banks and their directors in the financial crisis. Now, for the first time, some of these directors will have to answer for their actions in a British court”.
RBS refused to comment.